Wednesday, March 09, 2005

Gasoline prices 2005: An inflation-adjusted bargain

They've been saying it on TV, morning and night: "The price of gasoline has risen again to a record high!" said one newscast, "The high prices are making it harder for some to keep their heads above water," said another. "Record high prices!" we keep hearing. "They don't even put the price on the sign anymore," joked Jay Leno on the "Tonight Show." "It just says, 'If you have to ask, you can't afford it.'"

It's not as if the reporters would have to work at doing calculations to figure this out. Not only are there instant inflation calculators on the Web, but the federal Department of Energy accounts for inflation in its annual report of gas prices. It says gas is actually cheaper now than it was throughout most of the 20th century. Yes, it's 65 cents more than it was six years ago, but it's nearly a dollar cheaper than it was for much of the 1920s and '30s — and more than a dollar cheaper than in 1980.